The Federal Reserve and the Bush administration have justified the extraordinary help offered to investment banks and investors by saying that it matters less how we got here and more how we deal with the situation as it is. For McCain, however, it's all about the journey. Poor decisions should not be rewarded-unless those poor decisions are made by really rich people who run investment banks and hedge funds. While "those who act irresponsibly" shouldn't be bailed out as a matter of principle, it's OK to take extraordinary measures to help banks prevent "systemic risk that would endanger the entire financial system and the economy." Obama and Clinton-and the Bush administration, through its various efforts to ease the mortgage crisis-have argued that it might be possible to spare further systemic risk if something was done to buck up the fortunes of homeowners. Bollocks, says McCain. People should just put up more money for down payments and work harder to keep current with their mortgage payments.

Straight talk? No doubt. At a time of rampant economic insecurity and low consumer confidence, at the end of a business cycle in which median incomes didn't rise and the percentage of working people with health insurance fell, McCain won't succumb to the easy temptation of saying that government policy can help improve the situation. But smart politics? I wonder. What's left of the Republican Party is becoming increasingly downscale, and many swing states have been ravaged by the housing crisis (Nevada, Florida) and globalization (Ohio, Michigan). Besides, he's already got the Let-Them-Eat-Cake vote sewed up.

© 2008